Remittance Flows In Ghana: An Analysis of Motives, Determinants and the Impact on Children’s Education

Abstract

The flow of remittances both internally and internationally has gained global interest due to its immense socio-economic contribution to development, especially within the developing regions of the world. By using a cross-sectional data from the sixth wave of the Ghana Living Standard Survey (GLSS VI), this study investigates the motivation and determinants of remittances as well as the impact of remittance inflows on children’s education. The Probit binary model and the Ordinary Least Square was used in the analysis. The study reveals that education of the remitter, poverty status of the household, relationship with spouse, relationship with son/daughter as well as relationship with son/daughter in-law are significant in determining the likelihood of households receiving remittances. The study also provides positive relationship between remittance received by a household and the age of household head, size of the household among others. The study further reveals that poor households are more likely to receive remittance income, and educated individuals tend to remit relatively more to their households than their less educated cohorts. With regards to impact of remittance inflows on children’s education in the household, the study shows that there is a significant and positive relationship between remittance and educational attainment of children left behind. The study recommends that greater efforts should be made by government to devise ways to integrate philanthropy initiatives into the remitting process, such as by having options to donate to public projects. This can be done through the creation of diaspora funds which may keenly focus on key developmental issues like education, health and infrastructure.